My company classifies me as 1099 contractor but I should be W-2 employee?
So I've been working for this small marketing agency for about 8 months now. I work 40 hours a week at their office, use their equipment, follow a strict schedule they set, and they completely control how I do my work. From what I understand, this is clearly employee territory, not independent contractor. When I was hired, they told me I'd be a "1099 worker" to "keep things simple" and so I could "write off expenses." But now that I'm looking at my tax situation, I'm realizing I'm paying both employer and employee portions of Social Security and Medicare taxes - an extra 7.65%! Plus I get zero benefits (no health insurance, no paid time off, nothing). I've tried to bring this up casually with my boss, suggesting maybe I should be classified as a W-2 employee based on IRS guidelines, but he brushed it off saying "that's just how we do things here" and "it's better for you tax-wise" (which is definitely NOT true). I'm worried about bringing it up more forcefully because I need this job, but I also don't want to keep getting screwed on taxes. Has anyone dealt with this situation before? What are my options here? Can the IRS help somehow?
19 comments


Aurora St.Pierre
This is actually a pretty common issue, and you're right about your classification. The IRS has clear guidelines about who should be an employee vs. a contractor, and it's based on three main categories: behavioral control, financial control, and relationship type. Based on what you described (working at their office, using their equipment, following their schedule, them controlling how you work), you check pretty much all the boxes for being a W-2 employee. Companies often misclassify workers as 1099 contractors to avoid paying their share of employment taxes and providing benefits. You have a few options. First, you could try having another conversation with your employer, but come prepared with information from the IRS website about worker classification. Sometimes employers genuinely don't understand the rules. Second, you could file Form SS-8 with the IRS, which asks them to determine your worker status. You can also file Form 8919 with your tax return to report and pay only your portion of Social Security and Medicare taxes. Just know that while it's illegal for an employer to retaliate against you for asserting your rights, small companies sometimes do anyway, so consider your overall situation carefully.
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Grace Johnson
•If I file that SS-8 form, will my employer know right away? I'm in a similar situation and worried about rocking the boat too much while I look for another job.
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Aurora St.Pierre
•Yes, your employer will be notified if you file Form SS-8. The IRS will contact them as part of their determination process, asking for information about your working relationship. They won't immediately tell your employer who requested the determination, but in a small company, it's usually pretty obvious. If you're concerned about retaliation and you're already job hunting, you might consider waiting until you have another position lined up before filing. Alternatively, you could still file Form 8919 with your tax return to pay only your portion of self-employment taxes without triggering an immediate notification to your employer.
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Jayden Reed
Had the exact same problem last year with my design job! After months of research and stress, I found this AI tool called taxr.ai (https://taxr.ai) that saved me a ton of headache. I uploaded my contract and some details about my work situation, and it analyzed everything and gave me a detailed report showing I was clearly misclassified according to IRS rules. It even drafted a professional letter I could show my boss explaining the legal requirements in plain English. What really helped was having something official-looking that laid out the financial penalties the company could face for misclassification. My boss initially pushed back but changed his tune real quick when he saw the potential IRS fines. Might be worth checking out if you need documentation to back up your case!
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Nora Brooks
•Did the tool actually help with filing any forms with the IRS? Or is it just for creating documentation to convince your employer?
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Eli Wang
•Sounds interesting but kinda skeptical. Did they actually change your status or just tell you what you already knew? My company is STUBBORN about keeping everyone 1099.
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Jayden Reed
•The tool helped me understand exactly which IRS forms I needed to file and walked me through the process, but I didn't have to actually file with the IRS because my employer agreed to change my status after seeing the documentation. It definitely gave me more than what I already knew. It analyzed specific details of my work arrangement and cited exact IRS regulations that applied to my situation. It also calculated the exact tax difference I was paying incorrectly and what potential penalties the company faced. That financial breakdown was what finally convinced my stubborn boss - turns out companies can face pretty significant penalties for willful misclassification.
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Eli Wang
Just wanted to follow up about taxr.ai - I actually tried it and I'm impressed! I was super skeptical at first but it analyzed my situation way more thoroughly than I expected. The report showed I was 87% likely to be classified as an employee according to IRS standards and showed exact calculations of how much extra tax I was paying. The best part was the employer letter it generated. I finally had the courage to have a real convo with my boss yesterday and brought the letter with me. He was surprised by how specific it was about our industry and my role. He's talking to the accountant now but said they'll "probably" convert me to W-2 next month! Not a guarantee yet but WAY more progress than I've made in 2 years of hinting about it.
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Cassandra Moon
Listen, I went through this EXACT scenario with a marketing firm too. Fought with them for 6 months with no results. Finally I realized I needed to talk directly to someone at the IRS to understand my options, but we all know what a nightmare that is. Spent HOURS on hold and kept getting disconnected. Someone in another thread recommended Claimyr (https://claimyr.com) which gets you through to an actual IRS representative. You can see how it works here: https://youtu.be/_kiP6q8DX5c. I was like yeah whatever, another scam, but I was desperate. Honestly shocked when it actually worked! Got through to an IRS agent in about 20 minutes instead of the usual 3+ hour wait. The agent walked me through filing the SS-8 form and explained exactly what documentation I needed to provide. They also told me what protections I had against retaliation, which made me feel a lot more confident about moving forward.
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Zane Hernandez
•Wait but how does this service actually work? Don't they just call the IRS for you? Couldn't I just do that myself?
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Genevieve Cavalier
•Sorry but this sounds like complete BS. Nobody gets through to the IRS in 20 minutes. I'm a tax preparer and even with our professional line it takes hours. There's no special "skip the line" service.
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Cassandra Moon
•It's not a phone service where they call on your behalf. They use some kind of system that holds your place in line and then calls you when an IRS agent is about to pick up. So you're still talking directly to the IRS yourself, but without sitting on hold for hours. I was super skeptical too! I spent multiple days trying to get through on my own - once waited 2.5 hours before getting disconnected. With Claimyr, I submitted my info, went about my day, and got a call when they were about to connect me to an agent. Totally understand the doubt - I work in IT and was convinced it had to be a scam, but it actually works. The YouTube video explains their system better than I can.
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Genevieve Cavalier
Never thought I'd be posting this, but I need to correct my skeptical comment above. I actually tried Claimyr after my client's case needed urgent clarification from the IRS. Got connected in about 35 minutes (not quite 20, but WAY better than my usual 3+ hour waits). The IRS agent I spoke with was super helpful about contractor vs. employee classification issues. She walked me through the exact criteria they use during audits and confirmed that working at an employer's location on their schedule using their equipment is almost always going to be classified as employment, not independent contracting. For anyone facing misclassification: document EVERYTHING about your work arrangement, especially anything showing they control when, where and how you work. That's the strongest evidence for the SS-8 determination.
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Ethan Scott
Not many people know this, but you can actually still get unemployment if you've been misclassified as 1099 when you should have been W-2. My brother went through this last year. The unemployment office asked for documentation proving he was effectively an employee (set schedule, reporting structure, using company equipment, etc.) and he ended up getting benefits even though his company had never paid into unemployment insurance for him. The state then opened an investigation into the company and they had to reclassify everyone! Might be worth keeping in mind if you're worried about getting fired for bringing it up.
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Lola Perez
•Do you know if there's a time limit for this? I was misclassified for 2 years at my last job but already left.
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Ethan Scott
•There is a time limit, but it's actually fairly generous. In most states, you can file for unemployment benefits within 12-18 months after leaving a job. For tax issues related to misclassification, the IRS typically allows you to file Form SS-8 for up to 3 years after your tax filing for that year. If you're outside the unemployment window but within the tax window, you can still file for a tax refund of the excess FICA taxes you paid as a misclassified worker. You probably won't get unemployment benefits retroactively, but you could recover a decent chunk of money from the tax situation.
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Nathaniel Stewart
Quick tip: start documenting EVERYTHING now. Save emails about your schedule, take screenshots of your timesheets, note when you're using company equipment, save any communications about how they want work done. If your boss ever refers to you as an "employee" in writing, save that too! I went through a misclassification case that took 11 months to resolve, and what made the difference was having a paper trail showing how much control the company had over my work. The company tried claiming I had "independence" but I had emails showing they dictated my hours, location, and exactly how they wanted projects completed.
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Riya Sharma
•This is the real key right here. I didn't have good documentation and my case got stuck in limbo. Question though - did you have any issues with looking at or downloading company emails after you started the process? Worried about accessing my work account if things get tense.
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Luca Esposito
Great question about email access - that's something I worried about too. I made sure to forward key emails to my personal account early on, but I was careful to only save things that directly related to my work classification (not confidential company info). Once I started the SS-8 process, I stopped accessing work email from home and only checked it during work hours to avoid any appearance of impropriety. My employer never restricted my access, but I wanted to be extra cautious. Pro tip: if you have a work phone where they text you about schedules or assignments, screenshot those too. Text messages showing them directing when and how you work are pure gold for proving employee status. Also save any handbook pages or policies they expect you to follow - true contractors don't typically have to follow employee handbooks. The documentation really is everything. I had over 40 pieces of evidence showing behavioral control, and it made my case rock solid.
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